Ten years of Cabela's: Tons of taxes, tons of business

Each year, some 7 million customers pass the sculpture "A leaf on a stream" by Vic Payne as they enter Cabela's in Tilden Township. Concerns over traffic and unfair tax advantages marked the outdoor superstore's opening 10 years ago, but most now acknowledge the chain store has brought welcome business and revenue to the area.

The slopes of farmland in northern Berks County would be difficult to build on.

Nearby roads were heavily traveled, but didn't provide a good way in.

The infrastructure improvements necessary to fix those problems would be expensive, and zoning laws would complicate the process.

That was how the Berks County Planning Commission and a national site selection firm viewed 150 acres of fields near Route 61 in Tilden Township a little over a decade ago.

You'd never know it, though, by driving through that property today.

The outdoor supply megastore Cabela's is there, drawing 7 million visitors each year, the company reports.

Wal-Mart and Lowe's followed, as have 22 restaurants, stores and other businesses.

This week marks the 10th anniversary of Cabela's opening, a move that created some opposition at the time because of the tax deal used to lure the company here.

But today most area officials and taxpayers seem to think the tax deal was the right move, and though some wish Cabela's presence drew more business to downtown Hamburg, most say they're happy the store came to Berks, where it opened on Sept. 17, 2003.

The county, Tilden Township and the Hamburg School District are in better financial shape as a result, and the development has saved taxpayers money and provided many jobs, officials said.

This tax year, Berks County has taken in $187,623 in property tax revenue from Cabela's and the other businesses near it. Tilden has received $46,705, and $675,267 in taxes went to Hamburg schools, said Tom McKeon, executive director of the county Industrial Development Authority.

"Cabela's has provided a tremendous economic boon to the area," he said. "When you look at all the numbers, there is no way to conclude otherwise."

Tax deal lured Cabela's

Those numbers only represent a portion of the property taxes Cabela's and the surrounding businesses pay, though.

The businesses are in a Tax Incremental Financing zone, or TIF (other than the Wal-Mart, which is outside the TIF).

Sixty-six percent of the taxes from businesses inside the TIF go toward repaying $21 million in bond debt for road and infrastructure improvements that were necessary to develop the site. The initial deal called for 82 percent of taxes to go toward that bond repayment, but that was later reworked.

The taxing bodies now keep the remaining 34 percent of property taxes, as they will until the deal expires in 2023. They'll then keep 100 percent of property taxes from the site.

When the TIF deal was struck, critics said Cabela's was getting a handout that was unavailable to smaller retailers.

Local officials who signed off on it, though, said without that deal Cabela's would have ended up outside of Berks - and probably outside of Pennsylvania - since someone else would have offered them a similar arrangement.

"Cabela's wouldn't have come here without the deal," McKeon said.

And without Cabela's, the site probably wouldn't have been developed at all, he said.

Officials from the township, school district and county all said they'd likely have higher tax rates if not for that development.

For example, last year Tilden collected $169,313 in the local services tax - a $52 tax charged to those who work in a municipality - and secretary/treasurer Cheryl Haus estimated 75 percent of that came from people working in Cabela's or surrounding businesses.

The township also took in more than $125,000 in realty transfer taxes from those businesses in the last decade, Haus said.

Ten years ago, some residents and conservation groups were concerned that the development would change Tilden's rural complexion, but because it's been confined to one area, that hasn't been the case, Haus said.

And because of the improvements to the Route 61 and Interstate 78 interchanges, traffic hasn't been a problem, she said.

Overall, the development has been good for the township, Haus said.

"It's not really an inconvenience to anybody," she said.

Impact on Hamburg

When downtown Hamburg merchants learned Cabela's expected to draw 19,000 people a day on average, some hoped to get 1 percent of that business.

"That would have meant gridlock," said Mike Heckart, owner of Miller's 5 & 10 on South Fourth Street in Hamburg.

That hasn't been the case, but there are some Cabela's shoppers who find their way downtown, which is about a 2-mile drive.

They come in part because Cabela's has a rack in its lobby with brochures promoting those businesses, said Deena L. Kershner, manager of Our Town Foundation, Hamburg's downtown revitalization program.

Some Cabela's employees also recommend that customers check out the downtown, business owners said.

"Cabela's is a great partner," Kershner said.

Downtown businesses need to promote themselves, though, if they hope to attract those customers, Kershner said.

Blue Mountain Herbals on State Street occasionally gets Cabela's customers, usually wives who are checking out the downtown while their husbands shop for hunting or fishing gear, said owner Shirley Dierolf.

"It's not the traffic they were expecting, but it's something," she said.

Hecky's Sub Shop on State Street is also thankful for the Cabela's customers and employees who sometimes stop in, some of them wearing Cabela's shirts, said grill cook Cindy Schaner.

But Hecky's and other downtown businesses said they did better a few years ago, before restaurants such as Five Guys and Red Robin opened near Cabela's. Now many visitors apparently choose to eat there rather than crossing Route 61 to Hamburg.

Heckart was happy to be getting at least a few Cabela's customers each week, but unhappy that Wal-Mart, too, came to Tilden.

The retail giant hurt his 5 & 10 store, and he had to consider closing. Instead Heckart switched from selling everyday items to secondhand goods such as furniture and cookware, a change that brought back most of his business, he said.

Store still a big draw

Cabela's, on the other hand, is doing business much like it did a decade ago, company officials said.

Other than a recent remodeling that widened its aisles and updated some of its taxidermy displays, it's primarily the same store.

It remains the chain's biggest store at 250,000 square feet, and still leads the company in visitors, even as Cabela's has increased from nine stores to 47 in the last decade. Nineteen more are planned to open in the U.S. and Canada over the next two years.

On weekends, you can see license plates from a dozen states or more in Cabela's parking lot, said Harold Luther, the store's events coordinator. The store also draws many regular customers, local folks who come so often he knows them by name, or at least by face, he said.

Feedback from the community has been positive, he said, in part because Cabela's sponsors a number of local events and donates to many area conservation causes.

The number of store employees fluctuates somewhat by season, but averages 500, he said. The company doesn't say how many are part-time or full-time, but starts hourly workers at $8.50 or $9, depending on their shift, with incentives to earn more. All managers are salaried.

On a recent weekday, Cabela's big parking lot was typically busy.

Among the customers were Bill Ferrey of Shickshinny, Luzerne County, and his girlfriend, Mindy Andes, who make the two-hour drive to Cabela's about six times a year, mostly so he can stock up on hunting gear.

"They have everything here," Ferrey said.

After he bought the chest waders he wanted, the couple drove home without heading downtown.

Mark Lenhardt comes a few times a year from Schenectady, N.Y., a four-hour trip he says is worth the drive. The catalog offers the same stuff, but doesn't allow you to hold it or try it on, Lenhardt said.

"This is like the best outdoor place you can have," he said. "It's awesome."

Lenhardt dropped more than $600 on knives, a cot and other items during his trip last week, which is less than he usually spends at Cabela's.

"When I get home my wife will still blow a gasket, though," he said.

Matt Lutz of Hamburg visits Cabela's three or four times a month, usually to buy ammunition and other deer hunting supplies. He also regularly shops at Wal-Mart and Lowe's, and eats at the adjacent J.A. Buffet.

Many of his friends also frequent the businesses, and they like that it saves them trips to the Reading area, he said.

Lutz didn't like that Cabela's recently got its assessed property value reduced, a change that increased the burden on other taxpayers, but said he's otherwise happy the company came, saying it's made Hamburg a better place to live.

"It brought so much more business here," he said. "Without them, that area would still be fields and farmlands."